Imperial Creditors Sue Board Over $800M MBS Purchase

Law360, New York (July 18, 2011, 8:17 PM EDT) -- Imperial Capital Bancorp Inc.'s unsecured creditors sued its directors and officers in California bankruptcy court Friday, claiming they imperiled the bank with a risky $800 million investment in mortgage-backed securities and lied to investors to line their own pockets.

In a complaint filed in the U.S. Bankruptcy Court for the Southern District of California, Imperial's official committee of unsecured creditors accused the bank's board of directors and executives of breaching their fiduciary duties to investors and creditors with the purchase, which they allegedly knew would put...
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